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OPTIONS SKEW

6 min · DYOR Education
FreeCOIN · Options
Goal

Take apart OPTIONS SKEW — which is more expensive: insurance against a fall or a bet on a rise.

OPTIONS SKEW on BTC/USDT, 1h: 25Δ risk reversal and 25Δ butterfly for 30 days, volatility points
OPTIONS SKEW on BTC/USDT, 1h: 25Δ risk reversal and 25Δ butterfly for 30 days, volatility points
What it shows

Which is more expensive: insurance against a fall or a bet on a rise.

Starting simple. Take two options at the same distance from the price: a put below the price and a call above it. The put is insurance against a fall. The call is a bet on a rise.

  • Insurance against a fall is bought more eagerly — the put is more expensive than the call.
  • Bets on a rise are more popular — the call is more expensive.

“More expensive” is measured in IV from the OPTIONS IV lesson. The options’ term is 30 days. There are two lines on the chart.

  • 25Δ risk reversal — the call’s IV minus the put’s IV. Below zero — puts are more expensive: more is paid for protection against a fall. Above zero — calls are more expensive.
  • 25Δ butterfly — the average IV of these two options minus the IV of the option at the current price. High — both wings are expensive: the market pays for protection against a strong move in either direction.

An example with Binance numbers for 1 October 2026.

30-day optionWhat it isIV
25Δ putinsurance against a fall35.67
At the moneystrike at the current price34.02
25Δ calla bet on a rise33.99
  • Risk reversal: 33.99 − 35.67 = −1.68. Puts are more expensive than calls.
  • Butterfly: (35.67 + 33.99) ÷ 2 − 34.02 = 0.81. The wings are more expensive than the middle.

What 25Δ is. It is a way to pick “the same distance from the price”. Options are taken whose chance of paying off is, roughly, one in four. Both values are in volatility points.

Deribit on the same day: risk reversal −1.65, butterfly 0.71. Puts are 1.7 points more expensive than calls: more is paid for protection against a fall than for a bet on a rise.

25Δ puts at the money 25Δ calls IV ↑ strike → risk reversal
The risk reversal is the difference in height between the right and left points. Here puts are above calls, so it is negative. The butterfly is how much higher the wings are, on average, than the middle.
What it's for

See what is paid for more: insurance against a fall or a bet on a rise.

For example.

  • Risk reversal −1.68: 25Δ puts are 1.7 volatility points more expensive than 25Δ calls.
  • Butterfly 0.81: both wings are more expensive than the middle. Protection against a strong move in either direction is being paid for.
  • The risk reversal crossed above zero — calls became more expensive than puts. One line shows it.
Where to find it
Indicators›COIN›Derivatives›OPTIONS SKEW
Settings
FieldOptionsDefaultWhat it changes
ExchangeChartChartCannot be switched for options indicators: there are no other values in the list.
The options exchange is chosen by the “Options exchange” field below.
Options exchangeBinance
Deribit		BinanceWhose options to count.
The chart’s exchange does not affect this: the indicator takes only the coin from the chart.
- Want Binance options — Binance.
- Want the main options exchange, with 19 times more BTC open interest — Deribit.

In the Style two lines: Risk reversal 25Δ and Butterfly 25Δ.

In alerts

Metric OPTIONS. Condition fields:

Options exchangeExchangeMarket TypeCoinTimeframeOptions metric

“Options exchange” — Binance or Deribit. “Options metric” for this indicator: 25Δ Risk Reversal 30D and 25Δ Butterfly 30D. The “Exchange” and “Market type” fields are in the form, but the options asset is taken from the coin.

Try it yourself
  1. Enable OPTIONS SKEW on 1h.
  2. Look at the sign of the Risk reversal 25Δ line in the legend.
What you should get. Minus — puts are more expensive than calls: more is paid for protection against a fall. Plus — the opposite.
Takeaway

The 25Δ risk reversal is the call’s IV minus the put’s IV: below zero puts are more expensive. The 25Δ butterfly is how much more expensive the wings are than the middle. Both lines are in volatility points, 30-day term.

Quick check

25Δ risk reversal = −1.68. What does it mean?

Show answer

Correct answer: Puts are 1.68 volatility points more expensive than calls

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